Feds' Probe of Visa Program Echoes in Va. Gov Race

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New developments in a federal investigation of a program that offers U.S. visas to foreign investors have Virginia Republicans attacking Democratic gubernatorial nominee Terry McAuliffe and the electric-car firm he headed with a plant in Mississippi and ties to China.

The Associated Press reported Tuesday that President Barack Obama's pick for the Homeland Security Department's No. 2 spot, U.S. Citizenship and Immigration Services director Alejandro Mayorkas, is under investigation for his role in helping a company run by Hillary Rodham Clinton's brother, Anthony Rodham.

That company, Gulf Coast Funds Management LLC, is among hundreds of "regional centers'' involved in a program known as EB-5 that allows foreign investors to obtain permanent resident visas if they invest at least $1 million in projects that create jobs for U.S. citizens, or just $500,000 for projects in economically distressed areas.

Gulf Coast Funds, based in McLean, Va., serves Mississippi and Louisiana, and it worked closely with GreenTech Automotive when McAuliffe was its chairman and it opened a plant in Horn Lake, Miss., with plans to build a major plant nearby in economically struggling Tunica County.

Construction near Tunica has not progressed beyond site preparation.

McAuliffe, a former Democratic National Committee chairman and a close adviser and chief fundraiser for Bill and Hillary Clinton's presidential campaigns, left his leadership position with GreenTech after he declared his candidacy for Virginia governor in November 2012.

Republican gubernatorial nominee Ken Cuccinelli narrowly trailed McAuliffe in last week's Quinnipiac University poll. Cuccinelli and is battling his own ethics questions over ties to troubled nutritional supplements maker Star Scientific and its chief executive, Jonnie R. Williams Sr., and more than $18,000 in personal gifts from him. Cuccinelli quickly seized on Tuesday's headlines to press his attacks on McAuliffe over GreenTech.

"I think it's time for Terry McAuliffe to come forward and answer questions about this serious matter,'' the attorney general said. ``Virginians deserve to know the truth about McAuliffe and GreenTech's potentially inappropriate solicitation of EB-5 visas.''

Federal authorities have not implicated McAuliffe or his former company in wrongdoing. McAuliffe's campaign dismissed Tuesday's news of the Mayorkas investigation and Cuccinelli's bid to exploit it.

"The investigation does not involve Terry and we hope that it is completed in a timely matter,'' McAuliffe campaign spokesman Josh Schwerin said. "Cuccinelli's attacks are an attempt to distract from his ties to the Star Scientific scandal.''

When asked last fall about GreenTech's decision to build in Mississippi, McAuliffe told reporters that Virginia economic development officials didn't want to bid on the plant to manufacture tiny, all-electric, low-speed two-seat cars.

Emails obtained by the AP, however, show repeated efforts by Virginia Economic Development Partnership officials under Democratic and Republican governors to interest the company in rural Virginia locations, even as the officials expressed misgivings about the company's financing plans, including its proposed use of the EB-5 program to attract Chinese investment.

The most routine users of the EB-5 program are Chinese investors. According to an undated, unclassified State Department report that the AP obtained about the program, the U.S. Consulate in Guangzhou, China, processed more investor visas in fiscal year 2011 than any other consulate or embassy.